particulars of the breach and whether the
foreign law differed from Ontario law.
Plaintiff was granted 30 days leave to amend
her statement of claim to properly plead
foreign law.
Slegers v. Sullivan, [2009] O.J. No.
5065, Ont. S.C.J., Brown J., Nov. 27/09.
Digest No. 2933-006 (Approx. 6 pp.)
CONSTRUCTION LIENS
CLAIMS – The court found that plaintiff and defendant did not have a fixed
price contract for building a new residential dwelling and that plaintiff was entitled to terminate the contract when
defendants stopped making payments.
Claim by plaintiff for the balance owing
on lien claims. Plaintiff entered into a contract with defendants to build a new residential dwelling on their lakefront property.
Defendants agreed to pay the cost of construction and fees based on a schedule. It
was anticipated that the contract price
would be $210,999 plus the flooring cost
and a management fee for a total of
$257,956. These prices were without reference to the various upgrades and changes
that occurred. Towards the end of the construction, the relationship between the parties broke down. Plaintiff stopped work on
the project and registered a lien. Several
other liens were registered by subcontractors. A certificate of action was registered.
HELD: Action allowed. Plaintiff was
awarded $105,083. Changes during construction required additional work by plaintiff’s framing contractor and further plan
approvals from the town’s building department. On a fair reading of the contract itself,
a review of the e-mails between the parties
and the evidence, the contract between the
parties was not a fixed price contract.
Plaintiff was contracted to act as a project
manager whereby subcontractors and materials were billed at invoice cost with plaintiff
applying a management fee of 10 percent.
Plaintiff was entitled to terminate the contract and stop work based on lack of payments by defendants and a lack of disclosure by them as to their ability to pay the
balance of their contractual obligations.
Plaintiff was owed the sum of $112,013 at
the time of termination of the contract,
reduced by the cost to repair the siding in
the amount of $6,930. The necessary holdback under the Construction Lien Act
(Ont.) which ought to have been maintained
by the homeowner is $28,800. Various subcontractors were awarded damages against
defendant owners.
Country Cottage Living Inc. v. Heath,
[2009] O.J. No. 4994, Ont. S.C.J.,
Mulligan J., Nov. 23/09. Digest No. 2933-
007 (Approx. 12 pp.)
CONTRACTS
NON EST FACTUM – The trial judge
erred in finding that the parties to a
transaction for the sale of a business were
not ad item.
Appeal from a decision allowing respon-
dent L, the vendor of a business and lessor
of property, to retain the deposit paid by
appellants. L cross-appealed from that por-
tion of the decision holding the purchasers
were not bound to lease the premises and
acquire the business. Appellant purchasers
were relatively inexperienced business per-
sons. Shortly before the transaction in issue
the purchasers had paid a deposit to anoth-
er business vendor that had been returned
when the purchasers decided not to go
ahead with that deal. L was an experienced
businessperson. He had a pool hall business
in his premises, which the purchasers want-
ed to reduce in size to permit them to oper-
ate a restaurant on the same site. They paid
a deposit of $50,000 for the business and
$8,190 on the lease. Appellants were not
provided with a formal lease or purchase
agreement. When appellants decided they
wanted out of the deal, L refused to return
their deposits. The judge found appellants
thought they could get out of the deal with
L based on their inexperience and their pre-
vious deal, but that was a mistake. However,
the judge refused to bind them to the lease
and business purchase agreement because
neither had been formalized, and the parties
were not ad item. Once judgment was
entered L returned the $50,000 deposit
made in respect of the acquisition of the
pool hall business.
TORT LIABILITY – Appellant was
entitled to indemnification from a codefendant for injuries sustained by a
third party in a motor vehicle accident
pursuant to the terms of a vehicle
leasing agreement.
Appeal from a decision that appellant
was not entitled to indemnification under a
leasing agreement with respondent P Ltd.
in respect of liability to G. G was killed in a
motor vehicle accident. His estate sued the
driver M, the driver’s employer, P Ltd., and
the owner of the vehicle, appellant. M was
acting in the scope and course of his employment at the time of the accident and drove
the vehicle with the consent of P Ltd. P Ltd.
leased the vehicle from appellant pursuant
to a standard form commercial leasing
agreement. The agreement contained an
indemnification provision that indemnified
appellant, as owner of the vehicle, from liability for third party claims arising from the
negligent operation of the vehicle by P Ltd.’s
employees. The trial judge found that the
indemnity clause did not oblige P Ltd. to
indemnify appellant for the third party
claims for personal injury and death arising
from the accident. Appellant argued that
the trial judge misapplied the rules of contract interpretation.
HELD: Appeal allowed. The trial judge
erred in finding that specific wording was
required to bring third party liability within
the scope of the provision. The agreement
specifically stated that risk and liability
associated with the vehicle remained with P
Ltd., vitiating against a restrictive interpretation of the indemnity provision. There
was no ambiguity in the provision. Its plain
and ordinary meaning justified a ruling in
favour of appellant.
Shaw GMC Pontiac Buick Hummer
Ltd. v. Polaris Explorer Ltd., [2009] A.J.
No. 1366, Alta. C.A., per McFadyen,
Martin and McDonald JJ.A., Dec. 14/09.
Digest No. 2933-009 (Approx. 9 pp.)
DEBTOR & CREDITOR
ARRANGEMENTS – The stay provisions of a protection order made
under the Companies’ Creditors
Arrangement Act applied to periodic
payments to former employees who
had retired or been terminated.
Appeals from the dismissal of a motion
for directions. The debtors were granted
protection under the Companies’
Creditors Arrangement Act (CCAA). The
order provided for a stay of all proceedings
against the debtors and a suspension of all
rights and remedies against the debtors.
The collective agreement between the debtor and the union obliged the debtors to
make periodic payments to former employees that had retired or been terminated.
Appellants brought a motion for directions
requesting an order directing the debtors to
resume the periodic payments. The motion
judge distinguished crystallization of the
periodic payment obligations under the collective agreement from the provision of a
service within the meaning of subs. 11. 3 of
the CCAA, as the services of former employees were provided pre-filing of the protection order. The union and the former
employees appealed.
HELD: Appeals dismissed. The periodic payments sought by the union were
not excluded from the stay provisions of
the protection order under subs. 11. 3(a) of
the CCAA. The payments required for
current services provided by the debtors’
continuing employees did not encompass
the periodic retirement or severance payments owed to former employees. Such
payments were best characterized as
deferred compensation under predecessor
collective agreements rather than compensation for services currently being performed for the debtors. In addition, the
vested interest of former employees in
such payments was inconsistent with current services being the source of the obligation to pay. The statutory payments
sought by former employees were not
excluded from the stay provisions of the
protection order. The stay provisions of
the CCAA were intended to freeze the
debtors’ debt obligations in order to permit restructuring for the benefit of all
stakeholders. Upon consideration of the
doctrine of paramountcy, such intent
would be frustrated if the order did not
apply to termination and severance payments owed under the Employment
Standards Act (Ont.) to terminated
employees in respect of past services.
Sproule v. Nortel Networks Corp.,
[2009] O.J. No. 4967, Ont. C.A., per
Goudge and Feldman JJ.A. (Blair J.A.
concurring), Nov. 26/09. Digest No.
2933-010 (Approx. 11 pp.)
EMPLOYMENT
& DISMISSAL LAW
WRONGFUL DISMISSAL – Plaintiff
was awarded damages of $132,500 in
lieu of 18 months reasonable notice.
Action for damages for wrongful dis-
missal. Plaintiff had been employed by
defendant for 16 years before his termina-
tion in November 2008. He had also worked
for the company between 1970 and 1988. In
between, plaintiff worked for another
employer and then opened his own busi-
ness, which failed. Defendant had experi-
enced a business slowdown and stopped
manufacturing in Canada. Plaintiff had
been the retail sales manager, being paid a
base salary together with a medical benefit
package and incentive commissions. The
proposed severance was $29,357. He did
not accept the proposal. Defendant paid
him the balance of his entitlement to group
benefit continuation, and termination pay
in lieu of notice pursuant to the Employment
Standards Act (Ont.).
EVIDENCE (CRIMINAL)
INFORMANTS – An application by
the defence for disclosure of the identity
of a confidential informant was dismissed.
Application to disclose the identity of a
confidential informant who allegedly told
police that he had seen firearms and crack
cocaine in applicant’s bedroom. On the
strength of that information, police
obtained two search warrants and
searched applicant’s residence. They
found a handgun and 245 grams of crack
cocaine. The defence acknowledged the
informer privilege which attached to the
confidential informer’s identity, but submitted that it came within the “innocence
at stake” exception to that privilege.
HELD: Application dismissed. The test
for disclosure of a confidential informer’s
identity had two parts. Applicant first had
to meet the threshold test and then a two-stage “innocence at stake” test. Defence
clearly failed to meet the initial threshold
test. It did not establish that the information sought from the confidential informer was not available from any other source,
or that without this information, applicant was otherwise unable to raise a reasonable doubt. Even if it had been met,
applicant failed to meet the first stage of
the innocence at stake test. He did not
demonstrate an evidentiary basis to conclude that there was information which
existed and which could raise a reasonable
doubt as to his guilt. Mere speculation or
a possibility that revealing the confidential informer’s identity would be helpful to
the defence was not sufficient.
R. v. Doucette, [2009] O.J. No. 4998,
Ont. S.C.J., Conway J., Nov. 24/09. Digest
No. 2933-012 (Approx. 6 pp.)
HIGHWAYS
ROAD ACCESS – The appellate
court dismissed an appeal from an
order that respondents were not
